John Hoffmire: Smart development for Africa: Building entrepreneurship at MEST

As Africa awakes to its enormous promises and confronts the challenges that it must surmount, the recent World Economic Forum Africa Summit in 2013 reflected on how Africa’s entrepreneurs can be transformed into global champions.

As Africa awakes to its enormous promises and confronts the challenges that it must surmount, the recent World Economic Forum Africa Summit in 2013 reflected on how Africa’s entrepreneurs can be transformed into global champions.

The key points that emerged were that, though entrepreneurship is growing rapidly in Africa, there are significant difficulties and barriers that entrepreneurs must confront. Lack of access to funding, insufficient infrastructure and inadequate skills and support services converge to create formidable challenges. Also, it was widely agreed that education is indispensable in furthering entrepreneurship.

It is a painstaking and lengthy process to adequately train, nurture, mentor and equip entrepreneurs. But it is amazing what people can accomplish with their innate drive, creativity and ambition in an enabling context. In this context, it is only fitting to discuss the vision and execution of the Meltwater Entrepreneurial School of Technology (MEST).

The story of MEST is gripping and its journey is moving. Born in Korea and adopted by a Norwegian family, Jorn Lyseggen, a visionary tech entrepreneur, is now catalyzing an entrepreneurial ecosystem in Western Africa. Lyseggen, who successfully created the SaaS (Software as a Service) Meltwater Group ($100 million revenue), felt impelled to make a profound social contribution, and this impulse crystallized in the form of Meltwater Entrepreneurial School of Technology.

Lyseggen believes that while talent is evenly distributed across the globe, opportunities are not; further, he believes that money is cheap and the really valuable things are expertise, competence, passion and conviction. Clearly the core tenets of care and concern can transform not only individual lives but also the social landscape. This more engaged approach calls for a more substantive ongoing commitment but one that holds the promise of being more fruitful and fulfilling.

Based in Accra, Ghana, MEST has set itself the incredibly empowering objective of molding and mentoring the brightest and most passionate young minds. In a very short span of time, MEST has become Ghana’s leading tech entrepreneurship incubator and is home to successful start-ups such as Saya, Retail Tower and mPawa, among others.

MEST has firmly thrown its weight behind the ideal of investing in people even before they have a start-up idea. As Lyseggen puts it, “MEST is the world’s earliest early stage start-up. We invest in people even before they know how to program or even have a business idea.” The promising young people are provided a very enabling context and global exposure.

Every year, nearly 1,000 or so talented college graduates from all across Ghana and a few other African countries are put through rigorous aptitude tests and screening exercises to select about 25 exceptional candidates with entrepreneurial promise. The “Entrepreneurs in Training” (EITs), as the successful applicants are called, undergo a rigorous two-year training program that unifies the diverse elements of basic business fundamentals, entrepreneurship and hands-on training in software development.

The fast-paced, challenging, start-up environment prepares them for developing and launching software applications in the global marketplace. In addition to the inculcation of comprehensive and enabling skills, the program also prepares the EITs for what Lyseggen asserts are the “hardships of being an entrepreneur.”

The structured approach to fostering entrepreneurship is methodically sequenced to create the most favorable outcomes. The ideal of tech entrepreneurship and the nurturing model for MEST are closely tied to the values and core expertise of the Meltwater Group. The three-phase approach involves training, incubation and mentorship. With all the attendant support systems, the rigorous two-year program culminates in a cohesive transition to real-world tech entrepreneurship.

Initially, the EITs' master industry-proven methodologies for software development and instruction is provided by accomplished practitioners. The program also draws upon the transformative zeal of teaching fellows who are recent graduates from premier universities such as Oxford, Stanford and the University of California at Berkeley, among others. Learning is further enriched through guest lectures, seeking to drive home the insights and experiences of executives and entrepreneurs of global renown.

The next rite of passage is through the MEST incubator. Successful EITs with approved business plans are offered the opportunity to transform their ideas into thriving businesses. The Meltwater Foundation awards them seed funding, ranging from $30,000 to $200,000, in exchange for a minority equity stake. The consequent returns are recycled back into the foundation’s work.

By providing seed funding at such an early stage of the start-ups, the Meltwater Foundation is also bridging the “pioneer gap,” which exists due to conventional venture capital’s need to avoid certain types of execution risks in certain under-developed ecosystems.

In addition to catalysing funding, the MEST incubator makes available physical infrastructure and access to a global network of advisers and contacts. Evidently, this comprehensive system underpins the rapid strides MEST is making in its endeavor. This unique approach to identifying, educating and coaching entrepreneurs is already producing some spectacular success stories in the form of companies that are vying for global recognition in terms of quality, innovation and execution.

Under the ethos of “once MEST always MEST,” the Meltwater Foundation continues to provide mentorship support to the companies once they emerge from the MEST incubator. World-class executives and entrepreneurs, with relevant target market insights, serve as board members or company advisers. This ongoing mentoring support is indispensable in optimizing the chances of international commercial deployment.

Admittedly, exit opportunities for new enterprises are rather limited in Ghana. However, given that the underlying nature of tech enterprise has global appeal and replicability, the MEST start-ups are encouraged to think globally. Increasingly, successful outcomes are corroborating the intent.

For instance, Retail Tower, one of the MEST-incubated companies, is a partner of choice for Amazon. Acquisition is likely to be another fertile avenue as global players decide to strengthen their presence in Africa. Very recently, the Dutch company GenKey, which is a leading provider of biometric ID management solutions, acquired MEST-incubated ClaimSync, a medical claim handling solution provider founded on the belief that smart technology leads to better health care.

Fostering entrepreneurship promotes the vision of creating jobs and wealth locally in Africa. Toward this end, MEST wants to support entrepreneurs who actually go on to become role models — who inspire upcoming generations across Africa. Part of this process is that MEST encourages the incubated companies to share stock ownership with employees. One hopes that this model spreads across Africa.

As the newly appointed director of the MEST incubator, Neal Hansch plans to help “accelerate and extend MEST’s reach across Africa and onto the global stage.” It will be interesting to see how the organization navigates the unenviable task of scaling impact. This will require not only adherence to core processes, programs and ideals but also incessant calibration to local needs and resources.

There are already efforts afoot to pioneer new models that can expand the impact well beyond that commensurate with organizational size. As Jeffrey Bradach posits, “the new frontier in the field of social innovation is finding ways to scale an organization’s impact without scaling its size.” If MEST can address this conundrum, then it will have made unparalleled headway in addressing the most critical challenges confronting our societies.

John Hoffmire teaches at SaÏd Business School at the University of Oxford.

Pankaj Upadhyay is a graduate of the MBA program at SaÏd Business School at the University of Oxford and is a development expert.